$42.5 million lease deal for new NPS HQ goes down in defeat

The entrance of Newark Public Schools at 2 Cedar Street.

The Newark Public Schools Advisory Board could not muster enough votes to approve a 16-year, $42.5 million lease deal for a new headquarters for the district staff.

The board voted 5-4 in favor, but six votes were needed to approve the new lease for 100,000 square feet of space at 765 Broad Street. 

The five "yes" votes were cast by Chair Antoinette Baskerville-Richardson, Kim Gaddy, Marques-Aquil Lewis, Leah Owens and Tave Padilla. The four "no" votes were cast by Dashay Carter, Philip C. Seelinger Jr., Crystal Fonseca and Donald G. Jackson Jr.

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NPS's current lease at 2 Cedar Street, owned by Hartz Mountain Industries, ends on July 31.

In its public notice, NPS said the lease at 765 Broad Street would not cost the district anything beyond what it is currently paying.

But TAPintoNewark obtained a letter written by the Berger Organization that offered to provide space in a building it owns at 33 Washington Street for $36.3 million over 16-years, or $18 per square foot.

Board members were told Hartz, under state law, could have doubled the month-to-month cost of leasing the space after the lease at 2 Cedar Street expired.

However, an email obtained by TAPintoNewark from Mark Killoughpdf, a senior vice president at Hartz Mountain, details an offer for a a five-year lease agreement for $17 per square foot for the 99,284 square feet of space NPS is currently leasing on the 9th and 10th floor of 2 Cedar Street.

With a 3 percent increase each year, the total payment over the five-year period would be $8.7 million, not including building expenses.

Board member Fonseca said NPS should take the five-year option and look into building its own headquarters for the district.

"We should not continue to make the same mistakes of the past and repeat history," Fonseca said. "We have already paid $120 million for a 20-year lease. We should enter into a five-year short term lease and invest in our future and build our own Board of Education building that we own for future generations. Let's invest the $40 million in Newark and create jobs-union jobs, apprentice jobs and prisoner re-entry. Let's stimulate our community." 

The board's vote came after intense criticism of the deal from Central Ward Councilwoman Gayle Chaneyfield Jenkins, who question why the district was spending so much money on a lease when it could instead move into one of the district's many unused school buildings or build its own facility.

"The district knew this lease was going to expire," Chaneyfield Jenkins said after the meeting. "Now we are rushing into this deal. This demonstrates poor planning and a lack of vision. Why didn't the district ever consider constructing its own facility, especially considering how much we are prepared to spend on a lease? We could have been in control of our own destiny. We would have stimulated our local economy and created jobs in the city for our residents. The best way to impact a child in the city is to give their parents a job."

Chaneyfield Jenkins said she supports a five-year extension of the current lease, which would give NPS an opportunity to develop a more cost-effective, long-term plan.

"The district spent over $100 million leasing space from Hartz Mountain for the last two decades and what do we have to show for it? Nothing," Chaneyfield Jenkins said. "For that kind of money, we could have built our own building for the district staff and still had plenty of money left over to invest in our children."

Mayor Ras Baraka said he does doesn't know the particular details of the various lease deals.

"I'm not intricately involved in it, and I didn't really get involved in the vote. It's really up to them," Baraka said. "My concern is that they pick a building where they are going to save the city money, because the school board is in a serious deficit. So hopefully whatever deal they make is going to save them money that they need to be able to function and move."

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